Power rate increase suggested in Hartley

A recent study conducted on the price of power in Hartley suggested a rate increase for customers serviced by the local utility.

The city council earlier this month reviewed a report compiled by Missouri River Energy Services (MRES) that analyzed Hartley's current electricity rates. MRES Rate Analyst Supervisor Karen Olofson suggested the city hike prices by an average of 2.5 percent due to increased power supply costs from the Western Area Power Administration (WAPA), which supplies Hartley with approximately 70 percent of its power, as well as other increased operating costs. The rate increase would also bolster reserves in the electric fund.

"[Rates in Hartley] are very competitive," Olofson told the council. "I think [a 2.5 percent increase] is really reasonable and will keep the utility financially healthy for the future."

Hartley Superintendent of Public Works Jaron Benz noted the utility's electric fund reserves are at a "healthy level" right now, but are projected to decrease over the next five years.

"This small adjustment would slow the projected decline of reserves to maintain them above an adequate level," he said.

If approved by the city council, the new rates will take effect in July.

The city adjusted electricity rates in 2017, but the restructured numbers didn't result in price increases for customers. The last actual rate hikes occurred in 2013 and resulted in a 4 percent increase.

"Rates have been able to remain stable for almost 10 years on account of power supply costs decreasing, as well as having no large, unforeseen operating costs pop up," Benz explained.

Benz said that although the rate study revealed a need to increase prices, it had some positive takeaways.

"We have a financially healthy electric utility that has enough reserves built up to cover most increased operating costs for the short term if they arise," he said. "Even with proposed increased electric rates, all rate classes will still be significantly below median electric rates of other utilities in the area whether they be municipal, rural electric co-ops or investor-owned utilities."

Benz noted Hartley is going to keep monitoring the possibility of additional increases in power supply costs from WAPA, which could potentially have a future effect on rates. Several dams along the Missouri River generate the hydropower provided by WAPA and their power output has continued to decrease during the ongoing drought.

"If drought conditions in the mountains and northern plains don't see relief in the future, they may be forced to increase their rates again," he said.